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National Assembly

Mid-year budget review report |08 September 2021

Over R1 billion savings for 2021


• Government makes request for R304 million to be re-allocated


Thanks to a decrease in government expenditures and budget cuts, the government has been able to make a net savings of R1,125,511,764.72 from its initial R11,013,648,296 budget slated for 2021.

In his mid-year review for budget year 2021 in the National Assembly yesterday, Minister for Finance, Trade and Economic Planning, Naadir Hassan, announced that the R1.2 billion savings marks a milestone for the country.

“It is the first time in a mid-year budget review that the government presents the National Assembly with a budget review that is R1.2 billion less than initially forecasted. This is a great accomplishment,” stated Minister Hassan.

Simultaneously Minister Hassan yesterday requested for the National Assembly’s approval, through a supplementary appropriation, to re-allocate the total sum of R303,911,788.83 to certain key budget heads.

This is to be taken from a total budget of R1,429,423,553.55 meaning that the government has been able to spend 28% less than projected, particularly for capital projects which have advanced at a slower pace than expected.

With the savings, the government has been able to reduce its primary budget deficit for this year from 11% to 7.6% and Minister Hassan noted that this is the positive outcome of the government’s principle to do more with less.

“This reduction in spending shows that the government is serious in its endeavours to make the public service more efficient by reducing wastage and expenditures where necessary,” Minister Hassan said.

The government made a budget cut of R5 million in other wages and salaries for Constitutional appointments (R1.6 million) and pension scheme contributions (R3.5 million).

Budget cuts in salary and wages has been slashed by R71.1 million due to savings, delays in recruitments as well as transfers during restructuring.

The largest salary and wages cut by entity is R19 million previously budgeted for the Ministry of Education followed by R8.3 million for the Seychelles Tourism Board which was transferred under the Ministry of Tourism and R6.8 million for the Ministry of Internal Affairs.

However around R11 million is being requested for additional funds for wages and salaries, primarily to pay for restricting and transfer costs such as R28,000 worth of leave pay that has to be paid on the closure of the department of information.

R8,366,000 is also being asked to be re-allocated to the department of tourism for the payment of salaries of staff from the Seychelles Tourism Board who have been transferred to the department.

Meanwhile R28 million in additional funds are to be reallocated to other wages and salaries to pay for annual gratuities previously not budgeted and late payments of end of contracts and gratuities (R16 million), as well as compensation for continuous service (R12 million).

From a savings of R216.9 million in goods and services, the government is planning to re-allocate R174.7 million in the supplementary budget and this includes.

  • R55 million for the Seychelles Agricultural Agency to cover for subsidies for farmers and shortfalls;
  • R800,000 for the payment of rent of the department of culture;
  • R104 million for goods and services budget heads that is to be transferred from STB to the tourism department;
  • R7.6 million to cover for the increase in contracts for cleaning of marshes and rivers not budgeted in the initial 2021 budget and to cover rent shortfall;
  • R310,000 for the Ministry of Family, Sports and Youth again for shortfall in rent;
  • R1.2 million for move of NISTI to the Ministry of Investment, Entrepreneurship and Industry;
  • R165,000 to the National Tender Board;
  • R117,000 to the Seychelles Media Commission to cover rent shortfall;
  • R584,000 to the Anti Corruption Commission to cater for the transfer of the Public Officers' Ethics Commission under its portfolio;
  • R1.3 million to the Truth, Reconciliation and National Unity Commission to cover rent costs and to cater for the services of a legal consultant.

A whopping sum of R836 million have been saved from capital projects that either will not be completed in 2021 or will not break ground this year as planned. The budget cut for capital projects is also due to the favourable appreciation of the rupee against foreign exchange, given that a number of capital projects were to be funded from foreign grants.

R115.2 million had been cut from foreign financed construction of an administrative block for the Attorney General’s Office; a R111.4 million cut from the department of defence which has seen a delay in the acquisition of a fast patrol vessel, communication equipment and construction of a jetty project, all of which was to be financed through foreign grants.

Another R105.7 million has been cut due to delays in the construction of new police headquarters building and from the local budget of new La Digue police station project while the Health Care Agency has seen a cut of R157.15 million due to delays in construction of the Baie Lazare health centre, La Digue hospital and isolation unit.

However R27 million is to be re-allocated to the Seychelles Public Transport Corporation (SPTC) as a subsidy to cover the losses it incurred this year while R14 million is being requested for the disability benefits under the Agency for Social Protection.

The supplementary budget further expects to re-allocate R16.2 million for subscriptions to international organisations and R2.8 million as contingency to cover expenses from the Covid-19 pandemic.


Elsie Pointe











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